52% of Albertans say they’re $200 or less per month away from not paying all bills: MNP

The number of Albertans struggling to get by and hovering close to financial insolvency has jumped back up, according to the latest MNP Consumer Debt Index released Thursday.

Alberta-based MNP said the number has “jumped back up to pre-pandemic levels, as financial support and loan deferral programs related to the pandemic begin to unwind.”

Over half (52 per cent) of Albertans now say they are $200 or less per month away from not being able to pay all their bills and meet all debt obligations each month — a 10-point jump since the December survey.

One in three Albertans surveyed said they are already technically insolvent, with no money left at the end of the month to cover their payments, which is up six points from December.

“Pandemic-related financial relief measures provided some much-needed breathing room over the last year, but now we’re seeing a rapid reversal,” said Donna Carson, a licensed insolvency trustee with MNP Ltd.

“The number of Albertans with virtually no wiggle room in their household budgets has increased significantly in the last three months and that suggests that we may start to see some falling behind on payments.”

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MNP conducts its survey through Ipsos on a quarterly basis.

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On average, Albertans say they are left with $620 after making their payments — down by $73, or 11 per cent from December.

“Some Albertans may be seeing their bills becoming due, even if they are not back to full-time work or full wages.”

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“Even though some Albertans are spending less and saving more as a result of pandemic measures, others are feeling more anxiety, and some are having to increase their debt to stay afloat after job, wage, or small business loss,” Carson said.

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More than a quarter (28 per cent) of Albertans say they have taken on more debt as a result of the pandemic.

This includes using their savings to pay bills (38 per cent), using credit cards (14 per cent), using a line of credit (six per cent), taking out a bank loan (six per cent), or deferring mortgage payments (five per cent).

“Unfortunately, taking on credit is not a good option for most. In fact, it creates a debt trap for many that can be impossible to get out of.”

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MNP said Albertans are significantly more likely (36 per cent) than any other province to say they plan to take on more debt to pay bills over the next year, including using high-interest options like credit cards (nine per cent) or a payday loan service (four per cent).

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The latest data from the MNP Consumer Debt Index was compiled by Ipsos on behalf of MNP LTD between March 4 and 9, 2021. For this survey, a sample of 2,001 Canadians aged 18 years and over was interviewed. Weighting was then employed to balance demographics to ensure that the sample’s composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. In this case, the poll is accurate to within ±2.5 percentage points, 19 times out of 20, had all Canadian adults been polled.